Supply trumps international issues to push gas prices down

Gasoline prices can be impacted by international events, but the military action in Israel and the downing of the Malaysian airliner have not led to an increase. Department of Agriculture analyst Harold Hommes says gas prices have been falling. “Basically around a dime from that 3.37 mark here in the (Des Moines) metro area, and I think that’s been pretty much replicated throughout the state. Falling nine or ten cents in the last two weeks,” Hommes says.

Hommes says a big reason for the drop is that the refineries are running without interruption. He says the refineries have had extremely low turnarounds or construction down times. “Barring a catastrophic situation, which we’ve not had, those are usually handled in pretty good fashion where industry covers for each other so that nothing gets missed if you will,” Hommes says. “Refinery production is running right at 100 percent right now, so the situation is as about as good as we could ask for.”

Hommes says the price of a barrel of oil did move up slightly from last week with the international news, but he says the good supply of gasoline has overridden concerns.

“There’s as much downward pressure on refined gasoline prices as there is upward,” according to Hommes. “The upward momentum if you will, or pressure is coming mostly from market psyche if you will, in that those are things that don’t necessarily really affect supplies in a fundamental stance.”

The drop in gas prices comes as the summer driving season is still in full swing.